Financial transactions tax (FTT) and sub-capitalism

                   Financial transactions tax (FTT) and sub-capitalism

Starting 2014, Robin Hood tax will apply to trading in stocks, bonds and derivatives in the European Union. This new tax will represent 0.1% of the value of stocks and bonds traded, and 0.01 % of the value of derivatives trades. Robin Hood tax could bring 57 billion euros annually (0.5 percent of European Union’s GDP) in the coffer of  European governments. This tax does not exist in USA. But, Financial transactions tax (FTT) could generate $352 billion in ten years for the US government (Harkin and DeFazio bill from the Joint Committee on Taxation). FTT can be an effective instrument of market correction and bring more stability, it lower the number of speculators and consequently reduce market volatility. American paid sales taxes when they go to a restaurant or purchase a new iphone, but there is no tax on sales these financial products. This reality is a distortion to the principle of equality in democracy and weakens the capacity of government to collect new taxes. The privilege not to pay taxes belongs to economic systems that precede capitalism and define financial capitalism as sub-capitalism. Lack of Financial transactions tax (FTT) in USA is a reward to an industry responsible of the financial crisis of 2008. The market of derivatives is increasing, it is now estimated at $1.2 quadrillion ($1200 trillion), but the world GDP is $ 60 trillion.  The risk of another big financial crisis is bigger today.

Financial transactions tax exist in performing market of countries like Austria, Australia, Hong Kong, South Korea, Singapore, South Africa and Switzerland. (CPEG, William Barclay-May 19^th, 2012).

Aboubacar Sissoko